Killer Show: The Station Nightclub Fire (41 page)

Legal theories against manufacturers of polyurethane foam who sold it to American Foam were tougher to marshal. Plaintiffs alleged that the foam was defective because it was not flame retardant, and because the “solid gasoline” described in Jeff Derderian’s earlier news piece bore inadequate warnings. We also floated a novel theory of “product stewardship” whereby manufacturers of extremely hazardous substances should undertake to ascertain the downstream uses to which their products will be put — and exercise some control over their eventual use. Polyurethane foam’s history of contribution to the French nightclub fire, the fire on the
Sigmund and the Sea Monsters
set, and the Dupont Plaza fire, prior to the Station fire, was cited as a reason the manufacturers should have known, and done, much more.

The
PU
foam manufacturing defendants would have none of it. Their position was that whichever manufacturer sold the foam to American Foam (and no one was admitting to it) did so for ultimate “fabrication” (cutting into egg-crate-convoluted sheets) without knowing its intended end use. Also, it was sold in minivan-size foam blocks called “buns” to be cut up by American Foam, and could not, therefore, have easily borne a flammability warning on the end product.

And, anyway, try proving who actually made it. It was essentially a generic product — the “Ford Taurus” of foam, according to Barry Warner — and most of it burned up in the fire. It probably bore no unique chemical signature to distinguish one manufacturer from another. Therefore, we would not be able to prove “product identification,” critical to any product liability claim — that is, that any given defendant actually manufactured the unlabeled, generic
PU
foam that American Foam cut into convoluted sheets and sold to The Station.

Moreover, the possible
PU
foam manufacturers contended that no makers could have anticipated that their product would be exposed to fireworks. (That a substance known to suppress sound might well be exposed to
any
ignition source, like a lit cigarette, in a nightclub was apparently not important to the
PU
manufacturers.) They’d successfully avoided regulation and liability enough times in the past. The industry had agreed not to mislabel its products as “self-extinguishing” or “non-burning” anymore, since the 1974
FTC
consent order, but it was still shipping millions of tons of non-fire-retardant foam (visually indistinguishable from the fire-retardant variety) without attempting to educate ultimate end users about its incendiary propensities. They were confident they’d dodge the bullet once again.

The landlord for the Station building, Triton Realty Limited Partnership, presented its own problems as a defendant. The Derderians’ lease provided that the landlord had no responsibility whatsoever for maintaining the building or keeping it in compliance with building and fire codes. It did, however, warrant to the Derderians that, at the time they took possession of the building in 2000, it met all applicable codes — which would have been impossible with Howard Julian’s foam blocks installed on the walls of the drummer’s alcove. No problem, countered Triton, through its counsel. That warranty ran
only to the Derderians
. For that reason, it gave rise to no duty to The Station’s patrons. And, anyway, it was expressly limited to the value of the real estate — a dubious number, in the case of 211 Cowesett Avenue. Raymond Villanova’s post-fire transfer of Triton Realty’s assets to other corporations
may have looked guilty enough, but there was no certainty that the allegedly fraudulent transfers would be admissible as evidence in any trial against Triton.

The doctrine of
respondeat superior
would also find application in the cases against the town of West Warwick and the state of Rhode Island. Fire Marshal Denis Larocque, a salaried member of the West Warwick Fire Department, was unquestionably a town employee; however, he also proudly carried a card identifying himself as a duly appointed “Deputy
State
Fire Marshal.” A single person can be the simultaneous agent/servant of two masters under the law, and in this case Larocque’s faulty inspections and fanciful capacity calculations were undertaken in the service of both the town
and
the state.

Unfortunately, the same Rhode Island statute conferring personal immunity upon the fire marshal for acts and omissions in the “good faith performance of his duties” also would, if applicable, have immunized both of his “masters” from vicarious liability for Larocque’s negligence. We would have to somehow prove that Larocque’s failure to notice the flammable foam and his increasing the club’s permitted capacity by implausibly calling the whole place “standing room” were in bad faith — a pretty tall order.

By contrast, the band and the Derderians were slam-dunks, as far as liability was concerned. Great White set off the pyro, and the club owners condoned it — if not specifically that night, then for all the pyro bands that appeared there. Unfortunately, the band only had a million dollars of insurance, and Jack Russell, having emerged from personal bankruptcy only six months before the fire, was not exactly in a position to supplement it. The Derderians, with only a million dollars of insurance themselves, filed for personal bankruptcy after the fire. End of story for the most clearly culpable civil defendants. Not a penny of their personal money would ever flow to the families of those whom their negligence had condemned to death or injury.

The law of principal and agent can work in ways that the general public may not immediately grasp. When the Third Amended Master Complaint named Anheuser-Busch and its Rhode Island distributor, McLaughlin & Moran Inc., as defendants, the bloggers scoffed. “The beer company?” “The
beer
company?” However, it was not quite the stretch they imagined.

The Budweiser companies ran a promotion of the Great White concert on radio station
WHJY
, handing out bottles of “born-on” dated beer that night and providing banners proclaiming, “Party with
HJY
and Budweiser” and “The Station Presents Great White.” A cursory inquiry by Budweiser concerning the band it was promoting would have revealed that Great White had been setting off illegal pyrotechnics in small clubs throughout the country
well before it arrived in West Warwick. Our master complaint alleged that the beer companies had a duty of at least minimal inquiry before attaching the Budweiser name to what was, essentially, a traveling criminal enterprise.

What’s more, the Anheuser-Busch family of companies was not exactly a stranger to the hazards of indoor pyrotechnics. Because of their ownership of the Busch Gardens and SeaWorld theme parks, senior officials of Anheuser-Busch Companies and Busch Entertainment Corporation served as members and alternates on the National Fire Protection Association’s Technical Committee on Special Effects, the drafter of
NFPA
Standard 1126, which is the national safety standard for the use of pyrotechnics “before a proximate audience.” That standard forbade just about every aspect of Great White’s pyro show at The Station.

When you’re in the business of selling an intoxicant, you’re in the business of risk management. Because the consumption of beer necessarily involves some risk, the only question is what degree of risk is acceptable as a matter of public policy. Beer-slowed reaction times impair driving. They also affect how quickly a crowd responds to perceived danger. Was it asking too much that this purveyor of intoxicants, whose subsidiaries helped set the
NFPA
standard for indoor pyro use, look at the pyro practices of the band it was promoting with its trusted name, banners, and intoxicant giveaways? Budweiser had only to visit Great White’s website in the weeks before the fire to see pictures of the band shooting pyro indoors.

But that was not all. Our investigation revealed that on the night of the fire, Mike “Dr. Metal” Gonsalves’s “talent fee” — a check made out to him personally — was written by Budweiser distributor McLaughlin & Moran. Gonsalves was, therefore, probably the agent not only of
WHJY
that night, but also of the beer distributor, as he stood before the Station crowd exhorting them to “drink all the Budweiser in the place” — while Dan Biechele set up illegal pyro onstage behind him. If the emcee, Dr. Metal, sufficiently controlled the stage at that moment to make his radio employer, Clear Channel, vicariously liable, then the company that
actually paid him
to hawk beer and toss out Budweiser hats and T-shirts that night was also his principal. “Dual agency” strikes again. Moreover, if Anheuser-Busch exercised sufficient control over the manner in which its licensees (like distributor McLaughlin & Moran) used the Budweiser trademark in promotions, then it, in turn, could be McLaughlin & Moran’s principal with regard to use of the mark in promoting the Great White concert. At least, that is what we on the Plaintiffs’ Steering Committee researched, and pled — and the Free Riders readily adopted.

Several other defendant groups rounded out the field. Our master complaint
alleged that the installer of the fire alarm system at the time of the Derderians’ takeover of the club failed to install smoke detectors in the building’s
HVAC
ducts, as required by the building code at the time, which would have immediately shut down the air handlers feeding fresh air to the fire. We also alleged that the manufacturer and seller of the pyrotechnic gerbs failed to adequately warn users that its product’s sparks, thought by many to be “cool sparks,” could not be used where they might strike any flammable surface. (It didn’t hurt plaintiffs’ claim that the pyro manufacturer had previously shipped pyrotechnic gerbs interstate to Randy Bast — who sold some to Dan Biechele — using a phony pyrotechnic operator license number. The pyro company thereafter lost its federal
ATF
license.) Our final complaint also alleged that the bus company for the Great White tour violated a federal statute regulating the transport of specified quantities of fireworks across state lines. We added them all as defendants, perhaps in an excess of caution.

We also sued one other major group of defendants. For years before the Station fire, multiple insurance companies conducted inspections of the club’s building as part of their underwriting process. Inspectors for Lloyd’s of London and Essex Insurance Company, the “insurance inspection defendants,” toured the property, oblivious of the flammable polyurethane foam that covered the entire west end of the club. Had any one of them blown the whistle on the presence of solid gasoline on the club’s walls, the entire tragedy would have been averted.

Unfortunately for the fire victims, however, tort law requires more than negligence on the part of a defendant, even if reasonable care by that defendant would have prevented the tragedy. As a threshold inquiry, courts determine whether a defendant “owed a legal duty” to the class of injured plaintiffs. The insurance inspection defendants argued that it didn’t matter how negligent they may have been, because they only conducted the inspections
for their own purpose
— deciding whether or not to write insurance policies. They never undertook the inspections to protect the public and, therefore, owed no legal duty to the general public — no matter how careless they may have been.

While no cases had been decided in Rhode Island on these facts, the law in most other states is exactly as urged by the insurance inspection defendants — that they have no legal duty to the plaintiffs, no matter how negligent they may have been. And Judge Lagueux agreed, granting the insurance inspection defendants’ motions to dismiss all the claims against them. It was a serious blow to the plaintiffs, but not wholly unexpected.

Actually, the dismissal of claims against the insurance inspection defendants was a good example of the legal process at work. Plaintiffs’ attorneys must necessarily plead as broadly as good faith allows — particularly in catastrophic mass tort cases such as the Station fire. Then, marginal legal theories are tested by preliminary motions, and some are dismissed long before trial. This winnowing-down by pretrial motion (either motions to dismiss, or for “summary judgment”) is the safety valve of the civil justice process. Moreover, unknown to most laymen is that
even after trial and verdict
, claims can be thrown out by the judge if the evidence did not meet purely legal requirements. Despite assertions of “tort reformers” (read: insurance lobbyists), complex tort litigation is anything but “jackpot justice.” The mill of justice may grind slowly, but it grinds exceedingly fine.

Finely or coarsely ground, justice in the Station fire cases would have to deal with the complications posed by multiple parties. Even the simplest case, like an automobile intersection collision, can involve multiple parties. A driver whose car is T-boned by another running a red light will likely sue the other car’s driver. But if his injuries are worse than they might have been because a safety feature on his own car was defective, he might also add his car’s manufacturer as a defendant.

Most cases involving multiple plaintiffs and defendants settle, if at all, in piecemeal fashion. That is, some defendants settle, and others don’t. Still others may settle later, leaving yet fewer remaining defendants to go to trial. In the case of the intersection collision, the defendant driver might settle by paying his insurance policy limit, leaving the auto manufacturer as the lone remaining defendant.

One thing about the consolidated Station fire cases was fairly certain, however: no defendant wanted to be the last non-settler going to trial. Defense counsel spoke of not wanting to be “the last one at the party.” Given the enormity of potential damages awardable, a defendant would not want to be standing alone as a jury was being impaneled.

A defendant will not settle a case and leave other defendants in the case to go to trial, however, if there is any chance that the non-settling defendant can later sue
him
for contribution after the non-settler gets whacked at trial. For this reason, and in order to encourage settlement of disputes, most states have enacted some version of the Uniform Contribution Among Joint Tortfeasors Act. Unfortunately, Rhode Island’s version was outmoded and contained a wrinkle that could cripple settlement efforts in the Station cases.